A former councillor and his young children narrowly escaped death when a violent assassin opened fire on them in broad daylight.

Gardai believe Gerard Killally was targeted in a row over unpaid debts as he left his luxury home in his father’s car at 10.40am yesterday.

His two-year-old son Ferdia and three-year-old daughter Beibhan were in the vehicle as well as his dad Jay.

A masked man got out from the passenger side of an Opel Astra and fired twice with a sawn-off shotgun.

The shots did not strike the car and bankrupt developer Killally, 42, managed to flee the scene, only to crash into a ditch and overturn the Volkswagen Passat into a field during the panic.

All four escaped any serious injury but were left extremely traumatised by the incident. It is believed a large sum of money was recovered from the boot of Killally’s car.

Jay said: “We are OK but we are very shaken. We are alive and that’s the main thing.”

Asked about the actions of his son yesterday, he added: “Only for Gerard we would all be dead. I think natural instincts just kicked in.”

Speaking to Irishmirror.ie, Killally said: “I can’t talk now. I’m not feeling great and the gardai told me not to talk.”

The attack was not caught on camera as Killally’s sophisticated CCTV system was maliciously cut in recent days.

Gardai were last night searching for the professional hitman team but they are satisfied the dad of four was targeted over financial dealings.

A source said: “Killally had fallen out with a number of people over unpaid debts. This was either a very significant attempt to kill him or a very significant attempt to frighten him.”

Killally was previously warned his life was in danger after he received bullets in the post.

Ger Killally with ex-Taoiseach Brian Cowen

The former Fianna Fail councillor and running mate of ex-Taoiseach Brian Cowen has been cited as a defendant in the civil courts in relation to a number of business and development deals.

He told neighbours in Shean, Edenderry, Co Offaly, he believed the gunmen were trying to kill him and his family.

One local man said: “I spoke to Ger after it happened.

“He was very shaken especially because his kids were in the car. He told me, ‘Somebody is trying to shoot me’.”

A number of those who claim Killally owes them cash last night moved to distance themselves from the attack.

One said: “I had nothing to do with it anyway. There are a number of people who have a problem with him.

“I’m not surprised it happened but I think it is very callous to attack this man while his kids were there.”

Killally told pals he had noticed the silver-coloured Opel Astra, with an 06-D registration, outside his home about half an hour before leaving.

However, he had assumed they were workers connected to a nearby bog.

Shortly after 10.30am he left in the Passat but as he attempted to pull out of his property the attackers blocked his escape.

A gunman wearing a balaclava got out of the car and fired two cartridges from the sawn-off shotgun at the businessman.

Killally quickly manoeuvred around their vehicle before smashing into a large flower pot and later crashing through a concrete bollard – dragging it 500 metres along the road.

Killally's home in Shean, Edenderry, Co Offaly

It is believed the hitmen chased his car some distance along the road. One witness last night described the horrific attack.

The neighbour said: “I was out the back cutting the grass and I just heard a crash. I saw the car come over the ditch and crash into the shed.

“The shed stopped the car from rolling. If the car had rolled then we could be dealing with something very serious.

“I saw the driver getting out and running up the field.”

The neighbour, who asked not to be named, added Killally later told him he was trying to draw the hitman team away.

He said: “He knew they were after him so he was trying to get them away from his children.”

The neighbour added he spotted Killally’s father on the road but neither of them could get to their phones because they were in the smashed car. He said: “We went down and I took the little girl and another neighbour took the boy. The children were upset but they weren’t hurt.”

The neighbour added he spoke at length with Killally.

He said “He thinks these lads were trying to kill him because they didn’t fire up in the air or let off a warning shot.”

Gardai were still trying to establish exactly what happened but confirmed they are hunting two men.

They appealed for information about the silver Opel Astra believed to have been used by – the gunman and his accomplice.

A former Cathaoirleach of Offaly County Council, Killally was estimated during bankruptcy proceedings in 2010 to have debts of more than €73million. Last year he received a suspended three-year prison sentence after pleading guilty to stealing €18,000 of equipment from a shop he used to own in Westmeath.

Killally was also handed 240 hours of community service for a fraud offence connected to the theft.

An auctioneer and developer who ran in the 2002 general election alongside political partner Mr Cowen, Killally has been at the centre of a number of court cases in recent years.